EN EN

EUROPEAN COMMISSION

Brussels, 4.6.2018

COM(2018) 388 final

REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND

THE COUNCIL

COSME

Programme for the Competitiveness of Enterprises and SMEs 2014-2020

Monitoring Report 2015

{SWD(2018) 299 final} - {SWD(2018) 300 final}

1

Contents

1. Introduction .......................................................................................................................... 2

2. Activities and results 2015 ................................................................................................... 3

2.1 Access to Finance ................................................................................................................ 4

2.2 Access to markets ............................................................................................................... 5

2.3 Improving Framework Conditions And Competitiveness ............................................. 6

2.4 Promoting Entrepreneurship and Entrepreneurial Culture ......................................... 8

3. Support measures and Administrative Expenditure ........................................................ 9

4. Contribution to the Climate Mainstreaming objective ................................................... 10

5. Conclusion ........................................................................................................................... 10

ANNEX .................................................................................................................................... 11

2

1. INTRODUCTION

COSME is the programme for EU actions to improve the competitiveness of enterprises, with

special emphasis on small and medium-sized enterprises (SMEs). It builds upon the

Entrepreneurship and Innovation programme (EIP) established for 2007-2013 under the

Competitiveness and Innovation Framework Programme (CIP). COSME actions seek to

optimise synergies with other EU spending programmes, in particular the European Structural

and Investment Funds (ESIF) and the Horizon 2020 programme which includes the

innovation activities which were previously part of the EIP.

COSME brings added value by addressing transnational issues and market failures in four key

areas defined by the legal base1:

1. Improving access to finance for SMEs in the form of equity and debt (at least 60% of

the global budget envelope);

2. Improving access to markets inside and outside the Union (21.5%);

3. Improving framework conditions for businesses and the competitiveness of

enterprises, including SMEs (11%);

4. Promoting entrepreneurship and entrepreneurial culture (2.5%).

In addition to the 28 EU Member States, the following countries participated in COSME in

2015: Albania, Serbia, Armenia,Turkey, Montenegro, FYROM and Moldova.

The Commission is responsible for the overall implementation of COSME. The first objective

is implemented through the financial instruments that are entrusted to the European

Investment Fund (EIF). The implementation of the actions under objectives 2, 3 and 4 is

largely delegated to the Executive Agency for SMEs (EASME). Indirect management by

international organisations is also envisaged for certain analytical and benchmarking

activities.

This report presents an overview of the COSME budget implementation in 2015, in

accordance with Article 15 of the COSME regulation, including support measures and

expenses of an administrative nature. The details of implementation for each objective are

included in annex 1. Annex 2 contains the list of beneficiaries for calls for proposals.

1 Regulation (EU) N° 1287/2013 of the European parliament and of the Council of 11 December 2013.

3

2. ACTIVITIES AND RESULTS 20152

The COSME legal base specifies an overall indicative budget of EUR 2.3 billion for the

seven-year period of COSME (2014-2020). The budget follows a spending cycle with

commitments planned to increase progressively up to the last year of the programme in 2020.

Payment credits are expected to follow the same trend but with a lower level in 2015 as the

programme had yet to create the legal commitments needed for generating payments. The

COSME legal base specifies that the programme is implemented through an annual work

programme and through support measures. The budget also includes administrative

appropriations for managing the programme.

The COSME budget is implemented through four budget lines with appropriations specified

by the corresponding revised financing decision for 20153. After adding contributions from

third countries, unused appropriations from the previous programming period and

miscellaneous transfers the budget available for 2015 was:

(a) budget line 02 01 04 01 for administrative expenditures: EUR 4 199 483

(b) budget line 02 01 06 01 for the functioning of the EASME agency: EUR 8 112 465

(c) budget line 02 02 01 for all other operational expenditure: EUR 117 350 819

(d) budget line 02 02 02 for access to finance operational expenditure: EUR 200 036 997

The financing decision for support measures4 provides for a contribution of EUR 8 342 000,

included in the budget line 02 02 01 of the general budget of the European Union for 2015.

On average 92% of the COSME activities, with the exception of access to finance, were

delegated to the EASME5.

In total, 99% of the €329 million euros available were committed. For payments, the

implementation rate was on average 89%.

2 For more details, please check annex 1. 3 C(2015) 3767 final 4 C(2015) 4198 final 5 SEC(2013) 493 final

4

2.1 ACCESS TO FINANCE

The COSME Regulation specifies that at least 60% of the total budget (EUR 1.4 billion)

has to be allocated to the financial instruments for 2014-2020.

In 2015, access to finance represented 59.2 % of the financial envelope available for COSME.

The final budget available for the financial instruments and accompanying actions, including

EFTA and third countries participation to the programme, was EUR 200 million. The total

budget committed for the Loan Guarantee Facility (LGF) 6

amounted to EUR 148.5 million,

while the total budget committed for the Equity Facility for Growth (EFG) amounted to EUR

50.7 million. The budget committed in 2015 for accompanying actions was EUR 0.8 million.

These actions included the promotion of financial instruments and the gathering of data on

SMEs access to finance.

Loan Guarantee Facility

27 guarantee agreements were signed in 2015 under the LGF with financial intermediaries

located in 17 countries (16 Member States and 1 participating third country). More than

51 000 SMEs received financing for almost EUR 1 300 million under the LGF, also thanks to

the enhancement of the LGF through additional risk-bearing capacity provided from the

European Fund for Strategic Investment (EFSI) which is available since July 2015. The

implementation continued to exceed expectations and confirmed the high market demand for

financing of riskier SMEs, especially start-ups and small businesses.

Equity Facility for Growth

Five commitments were signed by EIF in 2015 under the EFG for the establishment of funds

focusing mainly on investments in Italy, France, the Netherlands, Greece and Germany, but

open to cross-border investments. The expected volume of investments into eligible final

recipients amounts to almost EUR 395 million and is expected to provide risk capital to

around 53 SMEs. Out of the five operations signed in 2015, two relate to Growth and

Expansion Stage funds and three to Multi-Stage funds, in combination with the InnovFin

Equity Facility for Early Stage set up under Horizon 2020. At the end of 2015, two of these

operations were unconditionally closed and the respective fund agreements signed with all

investors. Unconditional signatures for the three other operations occurred in 2016. First

investments into SMEs took place in 2016.

In 2015, the GIF (High Growth and Innovative SME Facility) instrument also continued to

provide risk capital to SMEs, with equity investments into 68 additional SMEs. Since its start,

the GIF has mobilised more than EUR 3.1 billion of equity finance to more than 500 SMEs.

This number will continue to rise over the next years as the investment period is still ongoing

for several funds.

6 Further information is available as part of the Report from the Commission to the European Parliament and

the Council on financial instruments supported by the general budget according to Art.140.8 of the Financial

Regulation as at 31 December 2015 (COM/2016/675 final) and the accompanying Staff Working Document

(SWD/2016/0335 final)

5

Awareness raising activities

In 2015 the Commission continued to update and promote the single portal on EU financial

instruments.7 The portal provides information how businesses can access COSME and other

EU financial instruments supported by Horizon 2020, EaSI, ESIF, EFSI and resources from

the EIB group. Technical improvements helped to make the portal responsive to meet the

needs of an increasing amount of mobile users. Various promotion activities including Search

Engine Optimisation helped to increase monthly page views from 100 000 early 2015 to

150 000 in November 2015.

In cooperation with national stakeholders and partner organisation, the Commission also

organised eight Access to Finance events in 2015, increasing the overall number of such

events to 29 (covering 28 Member States and the former Yugoslav Republic of Macedonia).

Overall, more than 3 000 participants attended these events.

The Commission, together with the European Central Bank, conducts regular surveys on the

access to finance of enterprises (SAFE). These surveys provide information on the financial

situation, financing needs, access to financing and expectations of SMEs. The 2015 results8

showed that access to finance was the most important concern of 10% EU SMEs in 2015

(down from over 15% in 2013), with bank loans remaining the most relevant form of external

financing for 50% of the SMEs.

2.2 ACCESS TO MARKETS

The COSME Regulation specifies that an indicative 21.5% of the total budget has to be

devoted to easing access to markets.

In 2015 EUR 61.5 million were dedicated to the Internationalisation of SMEs.

COSME provides support to European enterprises and, in particular, to SMEs to help them

benefit from the Single market by establishing business links outside their own country and

also to export outside Europe.

Enterprise Europe Network

The Enterprise Europe Network (EEN) provides integrated business support services to

companies who seek to innovate, grow and explore opportunities in the Single Market and

third countries. On a yearly basis, the network provides services to about 250.000 SMEs,

including specialised advisory services to some 70 000 SMEs. An evaluation of the Network

shows that SMEs who use the EEN have 3.1% higher job and turnover growth than those who

do not.

In 2015, there were 527 participating organisations from 90 consortia covering all regions of

the EU and 8 COSME participating countries, including Serbia and Armenia who joined the

7 www.access2finance.eu 8 Detailed results available at http://ec.europa.eu/growth/safe

6

Network. Framework partnership agreements were put in place and specific grants

agreements for the first operational period 2015-2016 were signed. The average EU

contribution to the eligible costs of Network partners is about 53%. Additionally, there were

30 cooperation agreements signed for Business Cooperation Centers in 29 third countries.

They focus their activities on partnership services and have to finance their activities by their

own resources. (Please refer to https://een.ec.europa.eu/ for the current list of partners).

Additionally, conditional terms for Associated Membership were signed with 13

organisations.

In 2015 the Commission, EASME and members of the Enterprise Europe Network

established a working group on access to finance. This proved to be an efficient measure as it

helped both, to improve the interest in COSME and other EU financial instruments thereby

mobilising their successful roll-out across Europe and to strengthen the financial advisory

capacity of the Network.

Increasing SME readiness to internationalise which uses the working title 'Ready2Go' aims to

give businesses the opportunity to broaden their horizons, build up foreign contacts and stand

out in the global market. It will provide training and network opportunities and started in

September 2016.

Other activities

The development of EU-Japan cooperation continues via the annual EUR 2.8 million grant to

the EU-Japan Centre improving the access of European businesses into the Japanese market,

by providing them with the needed data on local conditions and by acquainting them with

commercial and industrial practices which EU businesses are facing in Japan. Training on

production technologies, quality management and innovation is also provided, aimed at

improving the competitiveness of EU businesses.

The Your Europe Business Portal attracted 1.6 million unique visitors in 2015 which

corresponds to an increase of 21% compared to 2014. The most visited sections9 are VAT and

customs (44%), funding (24%), and start & grow (11%). A new functionality allowed users

who need more expert advice to send enquiries directly to a member of the Enterprise Europe

Network (EEN). The EEN partners received a total of 2.884 requests for information via the

form hosted on the portal. Finance was the top subject followed by "Expanding abroad" and

"EU law and research".

According to a survey with portal visitors over 83% of users rate the portal excellent, good or

satisfactory.

2.3 IMPROVING FRAMEWORK CONDITIONS AND COMPETITIVENESS

The COSME Regulation specifies that an indicative 11% of the total budget has to be

devoted to improving framework conditions and competitiveness.

In 2015, EUR 24.3 million were directed to this objective from the Work programme and

EUR 5.8 million from the Support Measures, representing 11.7% of the financial envelope.

9 9 VAT and customs is now entitled "Taxation" and funding is now entitled "Finance and funding"

7

COSME funded actions aiming at reducing the administrative burden, strengthening

coordination of Member States’ industrial policies and reinforcing the use of the 'Think Small

First' principle. COSME also promoted resource efficiency, sustainability and corporate social

responsibility. Actions to improve the competitiveness of strategically important sectors in the

European economy were also carried out, as well as a series of studies which together make

up the "Report on single market integration and competitiveness in the EU and its member

states"10

.

CLUSTERS

The "Clusters Internationalisation Programme for SMEs" focusses on the promotion of cluster

internationalisation where interested consortia have the opportunity to develop a joint

international strategy and support SME internationalisation beyond Europe, especially in

emerging thematic areas. It also contributes to facilitate international cluster cooperation

through the further development of the European Cluster Collaboration Platform.

Cluster initiatives reach out to groups of specialised companies and support strategic

interregional and international collaboration.

DESIGN BASED CONSUMER GOODS

The objective of the action is to reinforce the competitiveness of the European SMEs active in

the design-based consumer goods by encouraging the market uptake of new and creative

solutions in the design-based consumer goods area. The measure therefore seeks to bridge the

gap between research and innovation on the one hand and market on the other hand by

supporting scale-up, market replication and/or first application of projects related to novel

products, services, techniques or processes.

Under this action 10 SME projects have been awarded: their scope ranging from innovative,

digital solutions to improve design processes and communication in the textile and clothing

value chain, innovative products embedding digital technologies to products and new business

models addressing environmental and societal challenges. According to the participants, such

actions are needed as a lot of innovative technological solutions already exist but companies

need help to overcome some barriers that make it difficult for them to reach the market.

TOURISM

The tourism initiatives funded by COSME 2015 contributed to strengthening the

competitiveness of the European tourism sector. The initiatives dedicated to the increase of

senior and young tourists' flows contributed to generate an extension of the tourism season,

which is fundamental for the industry to gain competitiveness and to offer all year round jobs.

11 projects are being co-financed (9 with a focus on senior tourists and 2 on young tourists)

for the duration of 12/18 months.

The EU transnational thematic tourism offer has been enlarged and diversified and new

public-private partnerships supported and consolidated. The participation of small and micro

10 http://ec.europa.eu/DocsRoom/documents/13418/

8

enterprises in tourism partnerships have been strongly encouraged and increased. 10 projects

are being co-financed for the duration of 15/18 months.

Actions to enhance tourism accessibility contributed to improving facilities and services for

tourists with special access needs. 8 projects on accessible tourism itineraries are being co-

funded for the duration of 18/24 months.

The visibility of European Destinations of Excellence has been improved, which will trigger

higher numbers of potential tourist arrivals and local spill-over revenues for the destinations

and tourism operators. 13 projects have been co-financed for the duration of 15/18 months.

Awareness-raising activities and events generated a better visibility and up-take of tourism

initiatives. The annual European Tourism Forum and European Tourism Day, conferences,

which gathered 200 and 400 participants respectively, largely contributed to the exchange of

views on main topics of interest to the tourism industry and the Member States. The feedback

from participants' surveys shows overwhelming satisfaction with the choice of topics and the

format and content of debate at these events.

Through a successful cooperation with the European Travel Commission (ETC), the visibility

of Europe as a destination both to intra-EU and to third-countries' travellers has been

increased. This was achieved through various branding and destination marketing actions

through the www.visiteurope.com portal, under which ETC published 100 new pieces of pan–

European content in six different languages and deployed new technical features.

2.4 PROMOTING ENTREPRENEURSHIP AND ENTREPRENEURIAL

CULTURE

The COSME Regulation specifies that an indicative 2.5% of the financial envelope has

to be devoted to promoting entrepreneurship and entrepreneurial culture.

In 2015, a budget of EUR 12.9 million11

has been implemented for the promotion of

entrepreneurship, in particular to the Erasmus for Young Entrepreneurs mobility scheme,

representing 4% of the total amount committed for COSME. The Erasmus for Young

Entrepreneurs call for proposal was oversubscribed and received an additional allocation of

EUR 1 million budgetary surpluses remaining from other activities.

ERASMUS FOR YOUNG ENTREPRENEURS

So far12

, nearly 12 000 entrepreneurs’ profiles have been registered and 3 900 matches

involving 7 700 entrepreneurs established. A survey shows that more than a third of the

would-be entrepreneurs who took part actually started a business.

Moreover, the COSME programme supported exchanges of best practices to promote

entrepreneurship education in the EU. Specific support for Web entrepreneurs was provided.

11 The initial enveloppe was EUR 10,8 million 12 Figures collected in 2015.

9

Some of the actions were targeted to specific groups such as young people, women or senior

entrepreneurs providing mentoring and other tailored measures to facilitate entrepreneurship

among these groups.

DIGITAL ENTREPRENEURSHIP MONITOR

Digital technologies and digitalization can make an increasingly important contribution

towards meeting today's most pressing societal challenges (including climate change

objectives) and supporting economic growth, by delivering new knowledge, products and

services. Making full use of new technologies, in particular ICT, will be the key to building a

more sustainable and energy efficient future to fight against the climate change. Digital

technologies affect the full product lifecycle. They bring substantial gains in terms of carbon

and energy efficiency. They also enable the management of end-of-life products in a smarter

and energy-efficient way.

Since March 2015, four Strategic Policy Forum on Digital Entrepreneurship meetings and two

Member States Board on Digital Entrepreneurship meetings have been organised. A first draft

of the Strategic Policy Forum’s recommendations has been provided on 10 March 2016.

3. SUPPORT MEASURES AND ADMINISTRATIVE EXPENDITURE

The COSME support measures are financed under the operational budget line 02.0201. In

2015 the total allocated to support measures was EUR 8.3 million.

Conferences, workshops and expert meetings were organised with participation of various

stakeholders (including national authorities, industry and consumer organisations, SMEs

representatives, non-governmental organisations) to discuss challenges facing different

industrial sectors. Particular attention was devoted to recommendations on how to better

address SMEs' needs and how to further foster competitiveness.

The administrative expenditure for DG GROW represented EUR 5.017.946, less than 2% of

the total amount committed. The budget implemented for the functioning of the Executive

Agency for SMEs was EUR 6.626.000 representing 2.6% of the total budget committed. In

total, administrative expenses represented 4.6% of the financial envelope in 2015.

The corporate communication campaign on COSME benefits for SMEs targeted 9 million

SME owners in Cyprus, France, Greece, Italy and Spain. It was rolled out in two phases:

Spring 2015(radio) and Autumn 2015 (online and print advertising).The objectives of the

communication strategy for SMEs were: Filling the gap between SMEs needs and available

opportunities; Bringing corporate and political communication together; Defining the

narrative with a "go local" approach; and Continously assessing the impact of our actions.

Moreover, the Enterprise Europe Network in the target countries reported an increase of

requests during the campaign (in particular, it was proven that at least 1000 additional

requests from entrepreneurs were directly related to the campaign).

The administrative expenditure covered studies, meetings of experts, information and

communication actions, including corporate communication of the political priorities of the

10

Union related to the general objectives of the COSME programme. Expenses linked to IT

networks and other technical and administrative assistance expenses incurred by the

Commission for the management of the COSME programme were covered.

4. CONTRIBUTION TO THE CLIMATE MAINSTREAMING OBJECTIVE

The contribution of the COSME programme to the climate mainstreaming objective, set for

all Commission programmes, has been estimated at €21.6 million representing 6.4 % of the

financial allocation in 2015.

Relevant objective/output Budget 2015

(EUR Million)

Enterprise Europe Network 13.3

Financial instruments: Equity Facility for Growth 8.3

Total 21.6

For several COSME actions, such as the Loan Guarantee Facility, it is challenging to track the

contribution to the climate mainstreaming without imposing an additional administrative

burden on financial intermediaries and, ultimately, the hundreds of thousands of participating

SMEs which are the final recipients.

5. CONCLUSION

2015 saw the programme become operational as the projects launched in 2014 took their first

steps in implementation.

Access to Finance remained a key action area. More than 51.000 SMEs received financing

for almost EUR 1 300 million under the Loan Guarantee Facility, and guarantee agreements

were signed in 17 countries. Information events on Access to Finance saw over 3000

participants attending events in 2015. And under the Your Europe Business Portal with its 1.6

million unique visitors the second most visited section is funding.

COSME, including the integrated business support services of the Enterprise Europe

Network, contributed to facilitating SMEs' access to finance and markets, to decrease the

disproportionate administrative burden and to promote entrepreneurship across the EU. As an

SME-focused programme, the COSME actions complement other EU programmes and build

on the solid experience from the predecessor programmes.

11

ANNEX

Table: COSME total budget available in 2015 for commitments

Budget line 02 01 04 01 for administrative expenditures

Voted budget, available after transfers: 3.864.722

Other external assigned revenue: 154.176

Contributions from third-countries: 180.585

Total Budget available for commitments: 4.199.483

Budget line 02 01 06 01 for the functioning of the EASME agency:

Voted budget, available after transfers: 8.047.977

Other external assigned revenue: 37.329

Contributions from Third-countries: 27.158

Total Budget available for commitments: 8.112.464

Budget line 02 02 01 for all other operational expenditure

Voted budget, available after transfers: 105.648.672

Transfer/carry-over: 3.447.990

Contributions from Third-countries: 8.254.157

Total Budget available for commitments: 117.350.819

Budget line 02 02 02 for access to finance operational expenditure

Voted budget: 174.791.725

Contributions from Third-countries: 12.141.530

EFTA contribution 139.833

Additional internal transfers 12.963.909

Total Budget available for commitments: 200.036.997

12

Table: COSME budget execution in 2015

Commitments13

Payments11

Budget

Line

Budget

available

Budget

implemented

Implemen

tation Credits

available for

payments

Payment

executed

Execution

% %

02 02 02 Access to Finance 200.036.997 200.036.997 100% 110.884.513 98.601.480 88,92%

02 02 01

Access to Markets, Business Environment &

Entrepreneurship

total budget

committed in 2015

including carry-

overs for 020201

117.350.820 115.358.094 98,30% 103.628.436 93.181.924 89,92%

Carried

over

EASME

actions carried-

over to 2016 33.590.388 33.104.718 98,55%

Carried

over

GROW

actions carried-

over to 2016 1.515.000 889.700 58.73%

02 01 04

01

Administrative

Budget 3.864.722 3.799.959 98,32% 3.864.722 653.053 16,90%

02 01 06

01

EASME -

Administrative

Budget

8.047.977 8.047.977 100,00% 8.047.977 8.047.977 100,00%

Operational

Budget committed

in 2015 including

carry-overs

329.300.516 327.243.027 99,38%

COSME

Total

Total budget

implemented,

including adm.

Expenses, after

execution of the

carry-overs

329.300.516 326.132.058 99,04% 226.425.649 200.484.435 88,54%

13 Including the voted budget, third countries and EFTA contributions and transfers